Chrysler, Village, AmerCable set talk; ServiceMaster mulls tweaks; CanWest upsizes; CHS, Algoma break

By Sara Rosenberg

New York, June 28 - Chrysler Corp. LLC, Chrysler Financial Services LLC, Village Voice Media and AmerCable Inc. came out with price talk on their credit facilities as all of these deals were launched with bank meetings during Thursday's market hours.

In other primary happenings, the ServiceMaster Co. has unofficially reworked its credit facility by discussing higher pricing, an original issue discount and maybe even call protection with lenders, CanWest MediaWorks upsized its credit facility, Texas American Resources Co. reduced pricing on its term loan, BBB Industries LLC revised price talk based on ratings and Medical Staffing Network Holdings Inc. moved guidance higher on its first-lien debt.

Also, Vertrue Inc. and inVentiv Health Inc. both added a leverage covenant to their credit facilities.

Moving to the secondary, Community Health Systems Inc. (CHS) and Algoma Steel Inc. both saw their credit facilities free up for trading, with both companies' institutional debt quoted atop par.

Chrysler Corp. held a bank meeting on Thursday morning to kick off syndication on its proposed $12 billion credit facility, at which time price talk on the transaction was announced, according to market sources.

The $10 billion first-lien term loan B was presented to lenders with talk of Libor plus 325 basis points and the $2 billion second-lien term loan was presented with talk of Libor plus 600 bps, sources said.

The first-lien term loan B is non-callable for one year then at 101 in year two, and the second-lien term loan is non-callable for one year, then at 103 in year two and 101 in year three, sources added.

JPMorgan, Goldman Sachs, Citigroup, Bear Stearns and Morgan Stanley are the joint bookrunners on the deal, with JPMorgan, Goldman and Citigroup the joint lead arrangers.

The deal is being done in connection with a buyout by Cerberus Capital Management, LP from DaimlerChrysler AG.

The loans are based on asset coverage, not cash flow.

Proceeds will be used to put cash on the balance sheet for liquidity. Along with the equity, the company will have approximately $17.5 billion of cash at closing.

Chrysler Corp. produces and sells Chrysler, Dodge and Jeep vehicles.

Chrysler Financial price talk

Also coming out with guidance was Chrysler Financial, as it held a bank meeting on Thursday afternoon to launch its $8 billion credit facility to investors, according to a market source.

The $2 billion second-lien term loan is being talked at Libor plus 500 bps, the $4 billion first-lien term loan B is being talked at Libor plus 275 bps and the $2 billion ABL revolver is being talked at Libor plus 275 bps, the source said.

The second-lien term loan has call protection of 102 in year one and 101 in year two, and the first-lien term loan B has call protection of 101 in year one.

The ABL and the first-lien term loan, which share the same collateral and the same covenants, went through a senior managing agent round, at which price talk of Libor plus 250 bps to 275 bps was being circulated on the tranches.

During the senior managing agent round, banks were offered $100 million of the revolver for "buy and hold" and $125 million of the first-lien term loan B for underwriting.

JPMorgan, Citigroup, Goldman Sachs, Bear Stearns and Morgan Stanley are the joint bookrunners on the deal, with JPMorgan, Citigroup and Goldman Sachs the joint lead arrangers.

This deal is also being done in connection with a buyout by Cerberus Capital Management, LP from DaimlerChrysler AG.

Cerberus is buying an 80.1% equity interest in Chrysler Holding LLC, a new holding company for Chrysler Financial and Chrysler Corp., from DaimlerChrysler for $7.4 billion. DaimlerChrysler will retain a 19.9% interest in Chrysler Holding.

Chrysler Financial provides financial services for vehicles in the NAFTA region.

Village Voice guidance emerges

Continuing on the price talk front, Village Voice Media announced guidance of Libor plus 250 bps to 275 bps on both tranches under its $193 million credit facility, as it too held a bank meeting during the session.

Tranching on the deal is comprised of a $15 million revolver and a $178 million term loan B.

BMO is the lead bank on the facility, which will be used to refinance existing debt and to fund a dividend.

Village Voice is a New York-based alternative media company.

AmerCable spread talk

And yet another deal to launch and reveal price talk was AmerCable, with its $135 million term loan B (B2/B-) talked at Libor plus 350 bps, according to a market source.

The company's $150 million credit facility also includes a $15 million revolver (Ba2).

Deutsche Bank is the sole lead arranger and bookrunner on the deal.

Proceeds will be used to help fund the acquisition of the company by Quintana Energy Partners LP and to repay existing senior bank debt.

AmerCable is an El Dorado, Ariz., manufacturer of flexible electrical power and control cables for harsh operating environments.

ServiceMaster discussing changes

ServiceMaster is talking to investors about revising its covenant-light institutional bank debt by increasing pricing, adding an original issue discount and possibly even adding 101 soft call protection for one year, according to a market source.

Under evaluation is increasing pricing on both the $2.65 billion seven-year term loan B and the $200 million seven-year pre-funded synthetic letter-of-credit facility to Libor plus 275 bps from initial talk of Libor plus 225 bps and selling the paper at a discount of 98½ to 99, the source said.

ServiceMaster's $3.35 billion senior secured credit facility (B1/B+) also includes a $500 million six-year covenant-light revolver.

Citigroup, JPMorgan, Bank of America, Goldman Sachs and Morgan Stanley are the lead banks on the deal, and there are nine senior managing agents.

Proceeds will be used to help fund the leveraged buyout of the company by Clayton, Dubilier & Rice, Inc. for $15.625 in cash per share. The total enterprise value is $5.5 billion, including the assumption of existing ServiceMaster debt.

ServiceMaster is a Downers Grove, Ill., provider of services to residential and commercial customers, including lawn care and landscape maintenance, termite and pest control, home warranties, disaster response and reconstruction, cleaning and disaster restoration, house cleaning, furniture repair and home inspection.

CanWest ups credit facility size

CanWest MediaWorks is upsizing its credit facility (Ba1/BB-) by C$140 million to C$1.09 billion in reaction to the downsizing of its bond deal to $400 million from $650 million, according to a market source.

The additional funds will be added to the term loan A and the term loan B tranches, but the amount by which each tranche will be upsized is still to be determined, the source said.

Prior to the upsizing, the term loan A was sized at C$250 million and the term loan B, which is being done in U.S. dollar equivalent, was sized at C$450 million.

Price talk on the term loan A is currently Libor plus 200 bps and price talk on the term loan B is currently Libor plus 175 bps to 200 bps.

CanWest's credit facility also includes a C$250 million revolver talked at Libor plus 200 bps, with a 52.5 bps unused fee.

Scotia Capital is the sole lead bank on the revolver and the term loan A, which are being sold in Canada, and Scotia and Citigroup are joint leads on the term loan B, with Scotia the left lead.

Proceeds will be used to help fund a privatization agreement between CanWest MediaWorks Income Fund and CanWest MediaWorks LP, under which the fund's outstanding units will be redeemed for C$9.00 in cash each.

Closing of the acquisition is expected to occur on or about July 10.

CanWest MediaWorks is a Don Mills, Ont.-based media company.

Texas American reverse flexes

Texas American Resources lowered pricing on its funded first-lien term loan, while upsizing the tranche, according to a market source.

In addition, the company decided to eliminate its $20 million delayed-draw term loan because it has no need for it right now, the source said.

The funded term loan is now sized at $160 million, up from $155 million, and pricing was reverse flexed to Libor plus 450 bps from initial talk of Libor plus 475 bps, the source added.

The deal was more than two times oversubscribed.

BNP Paribas is the lead bank on the loan, which will be used to refinance existing debt.

Texas American is an Austin, Texas, energy company.

BBB resets price talk

BBB Industries revised price talk on its $25 million revolver and $112 million first-lien term loan to Libor plus 275 bps from Libor plus 250 bps as a result of getting a private rating of B3, according to a market source.

The original price talk had been based on B2 ratings, the source added.

Price talk on the $46 million second-lien term loan remained unchanged at Libor plus 550 bps.

General Electric Capital Corp. is the lead arranger on the $183 million deal, which will be used to help fund the leveraged buyout of the company by Windjammer.

BBB is a Mobile, Ala., producer of new and remanufactured automotive alternators and starters.

Medical Staffing moves talk higher

Medical Staffing Network modified guidance higher on its $30 million six-year revolver and $100 million six-year first-lien term loan B to Libor plus 325 bps to 350 bps from initial talk at launch of Libor plus 275 bps to 300 bps, according to a market source.

The company's $25 million seven-year second-lien term loan is still being talked at Libor plus 600 bps, the source added.

The second-lien term loan carries call protection of 101 for one year.

General Electric Capital Corp. is the lead bank on the $155 million senior secured deal.

Proceeds will be used to fund the $92 million cash acquisition of InteliStaf Holdings Inc., to refinance Medical Staffing Network's existing debt and to provide for working capital and general company purposes.

Medical Staffing Network is a Boca Raton, Fla., provider of per diem nurse staffing services. InteliStaf is an Oakbrook Terrace, Ill., health care staffing company.

Vertrue inserts leverage covenant

Vertrue added a leverage covenant to its first- and second-lien term loans, which previously contained no financial covenants at all, according to a market source.

The $430 million seven-year first-lien term loan (Ba3) leverage covenant opens at 7.25 times and the $200 million eight-year second-lien term loan (Caa1) leverage covenant opens at 7.5 times, the source said, adding that step downs are still to be determined.

Price talk on the first-lien term loan is still Libor plus 225 bps to 250 bps and price talk on the second-lien is still Libor plus 550 bps to 575 bps.

The second-lien term loan carries call protection of 102 in year one and 101 in year two.

Vertrue's $660 million senior secured credit facility also includes a $30 million six-year revolver (Ba3) that is talked at Libor plus 225 bps to 250 bps, with a 50 bps commitment fee.

There was no need to add a leverage ratio to the revolver because the tranche already carries one, the source explained.

Lehman and JPMorgan are the joint lead arrangers and joint bookrunners on the deal, with Lehman the administrative agent and JPMorgan the syndication agent.

Proceeds will be used to help fund the buyout of Vertrue by management, One Equity Partners, Oak Investment Partners and Rho Ventures for $48.50 in cash per share of common stock. The transaction is valued at about $800 million.

Other buyout financing will come from a $175 million equity commitment.

In connection with the buyout, Vertrue will redeem, repurchase or defease all of its outstanding 9¼% senior notes due 2014.

A portion of the second-lien term loan can be delayed draw for 45 days if a defeasance deposit needs to be made for the notes.

In addition, immediately after the buyout, the company will deposit in a segregated escrow account an amount equal to the aggregate principal amount of its 5.5% convertible senior subordinated notes due 2010 that have not been converted into equity on or prior to the date of the buyout.

Vertrue is a Norwalk, Conn., internet direct marketing services company.

inVentiv puts in covenant

Also inserting a maximum leverage covenant to its credit facility was inVentiv Health, according to a market source.

The $400 million deal (Ba3/BB-) consists of a $50 million six-year revolver, a $330 million seven-year term loan and a $20 million six-month delayed-draw, with seven-year final maturity, term loan, with all three tranches talked at Libor plus 175 bps.

The delayed-draw term loan has a 100 bps undrawn fee.

UBS and Bank of America are the lead banks on the deal, which will be used for acquisition financing and to refinance an existing term loan.

Leverage will be in the mid-2s.

inVentiv is a Somerset, N.J., provider of value-added services to the pharmaceutical and life sciences industries.

Nelson includes leverage covenant

Nelson Education added a maximum senior leverage covenant that starts out at 7.5 times to its revolver and first-lien term loan, with cross-defaults with its second-lien term loan, according to a market source.

In addition, the PIK toggle option under the second-lien term loan was eliminated, the source added.

The facility consists of a C$50 million U.S. dollar equivalent revolver (Ba3/BB-), a C$330 million U.S. dollar equivalent first-lien term loan (Ba3/BB-) priced at Libor plus 250 bps, with an original issue discount of 993/4, and a C$181.5 million U.S. dollar equivalent second-lien term loan (Caa1/CCC+) priced at Libor plus 575 bps, with an original issue discount of 993/4.

Earlier on in syndication, the revolver lost its super-priority status, the first-lien term loan was flexed up from Libor plus 225 bps, the second-lien term loan was flexed up from Libor plus 525 bps, and the original issue discounts were added to the two term loan tranches.

The second-lien term loan carries call protection of 102 in year one and 101 in year two.

RBC Capital is the lead bank on the C$561.5 million U.S. dollar equivalent deal, which will be used to help fund the acquisition of Nelson Education by Omers Capital Partners and Apax Partners from the Thomson Corp.

Nelson Education is a Scarborough, Ont., provider of books and online resources for the educational market in Canada.

Metroflag tweaks deal

Metroflag moved some funds from its second-lien term loan into its first-lien term loan and revised pricing on both tranches, according to a syndicate document.

The one-year first-lien term loan is now sized at $280 million, up from $250 million, and pricing was increased to Libor plus 177 bps from original talk of Libor plus 150 bps, the document said.

Meanwhile, the one-year second-lien term loan is now sized at $195 million, down from $225 million, and pricing was reduced to Libor plus 900 bps from original talk of Libor plus 1,000 bps, the document added.

Credit Suisse is the lead arranger on the $475 million deal.

Proceeds will be used to refinance existing debt.

Dollar General adds OID

Dollar General Corp. added an original issue discount of 99 to its $2.43 billion seven-year term loan B (B3/B+) and is now talking the paper at Libor plus 275 bps, as opposed to at Libor plus 250 bps to 275 bps, according to a market source.

Dollar General's $3.43 billion senior secured credit facility also includes a $1 billion six-year asset-based revolver talked at Libor plus 150 bps, with a 37.5 bps undrawn fee.

Goldman Sachs, Citigroup, Lehman Brothers and Wachovia are the joint lead arrangers and joint bookrunners on the credit facility. CIT Corp. is the administrative agent for the asset-based revolver.

Proceeds will be used to help fund the buyout of Dollar General by Kohlberg Kravis Roberts & Co. LP for $22.00 in cash per share.

Dollar General is a Goodlettsville, Tenn., discount retailer.

Asurion expected at wide end

Asurion Corp. is anticipated to firm up pricing on its first- and second-lien term loans at the high end of the most recently modified guidance, according to a market source.

The $1.755 billion first-lien term loan is anticipated to end up at Libor plus 300 bps, compared with most recently revised talk of Libor plus 275 bps to 300 bps, Libor plus 250 bps before that and original talk at launch of Libor plus 225 bps, the source said.

The first-lien term loan is being sold at 99 and carries 101 soft call protection for one year, with both of these features added during syndication. When the discount was first added it was set at 99½ and then it got revised to 99.

Meanwhile, the $580 million second-lien PIK toggle term loan is anticipated to end up at Libor plus 650 bps cash pay, compared with most recently revised talk of Libor plus 625 bps to 650 bps cash pay, Libor plus 575 bps cash pay before that and original talk at launch of Libor plus 550 bps cash pay, the source added.

If PIK is elected on the second-lien loan, pricing will increase by 75 bps.

Call protection on the second-lien term loan is 102 in year one and 101 in year two. This was changed during syndication from just 101 in year one.

Asurion's $2.435 billion credit facility also includes a $100 million revolver that is priced at Libor plus 200 bps, in line with original talk.

Merrill Lynch, Bank of America and Lehman Brothers are the lead banks on the deal.

Proceeds will be used to help fund the acquisition of a majority stake in the company by Madison Dearborn Partners, Providence Equity Partners and Welsh, Carson, Anderson & Stowe.

Asurion is a Nashville provider of enhanced services to the wireless telecommunication industry.

DeltaTech sets talk

DeltaTech Controls, Inc. price talk emerged now that the deal was launched to investors with a bank meeting on Wednesday, according to a syndicate document.

The $25 million six-year revolver (B1/B+) is being talked at Libor plus 250 bps, with a 50 bps commitment fee, the $141 million seven-year first-lien term loan B (B1/B+) is being talked at Libor plus 250 bps and the $54 million 71/2-year second-lien term loan (Caa1/B) is being talked at Libor plus 600 bps, the document said.

Credit Suisse and UBS are the lead banks on the $220 million deal.

Proceeds will be used to help fund the acquisition of the company by Littlejohn & Co., LLC.

Leverage is roughly 4.6 times through the second-lien debt.

DeltaTech is a Hong Kong-based designer, manufacturer and marketer of customized electromechanical switches, interface controls and dome arrays.

Community Health frees to trade

Switching to trading news, Community Health Systems' credit facility broke for trading, with the strip of funded and delayed-draw term loan debt quoted at par 1/8 bid, par 3/8 offered, according to a trader.

The $6.065 billion seven-year funded term loan and the $400 million seven-year delayed-draw term loan are both priced at Libor plus 225 bps.

During syndication, the funded term loan was upsized from $5.7 billion following a bond downsizing and the delayed-draw term loan was downsized from $500 million.

In addition, pricing on the term loans was reverse flexed to Libor plus 200 bps from original talk at launch of Libor plus 225 bps, but then it was brought back up to initial talk.

Community Health Systems' $7.215 billion senior secured credit facility (Ba3/BB-) also includes a $750 million six-year revolver, with a 50 bps commitment fee.

Credit Suisse and Wachovia are the lead banks on the deal.

Proceeds from the credit facility, along with the bonds, will be used to help fund the acquisition of Triad Hospitals Inc. for $54.00 per share in cash, or $6.8 billion, including $1.7 billion of existing debt.

The funded term loan will be used to help finance the acquisition and to refinance existing debt, and the delayed-draw term loan and revolver will be used for working capital and general corporate purposes.

Community Health is a Nashville operator of general acute care hospitals in non-urban communities. Triad is a Plano, Texas, owner and manager of hospitals and ambulatory surgery centers.

Algoma breaks

Algoma Steel's credit facility also freed up for trading on Thursday, with the $450 million term loan B (B3/BB-) quoted at par ¼ bid, par ¾ offered, according to a trader.

The term loan B is priced at Libor plus 250 bps.

During syndication, pricing on the term loan B was reverse flexed from Libor plus 300 bps.

Algoma's $850 million senior secured credit facility also includes a $400 million ABL revolver.

Proceeds were used to fund the recently completed acquisition of the company by Essar Steel Holdings Ltd. for C$1.85 billion.

UBS acted as the lead bank on the deal.

Algoma Steel is a Sault Ste. Marie, Ont.-based steel producer. Essar Steel is a Mumbai, India-based steel company.

LCDX lower

LCDX headed back down on Thursday as the market in general felt a "tad heavy," according to a trader.

The index went out at 98.05 bid, 98.15 offered, down from 98.15 bid, 98.25 offered on Wednesday, the trader added.

Ainsworth closes

Ainsworth Lumber Co. Ltd. closed on its $102.6 million senior secured term loan (Ba3/B-) due June 26, 2014 that is priced at Libor plus 300 bps, according to a company news release.

Proceeds will be used for working capital and general corporate purposes.

Ainsworth is a Vancouver, B.C.-based forest products company.

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